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Asia-Pacific Countries with Special Needs Development Report 2017

Investing in Infrastructure for an Inclusive and Sustainable Future

The Asia-Pacific countries with special needs development report 2017 introduces the access to physical infrastructure index as a tool to capture the multidimensional character of infrastructure and to illustrate the strong positive causality between infrastructure and sustainable development. The report highlights that significant infrastructure gaps exist among the countries with special needs, and estimates that these countries need to invest an average of 10.5 per cent of GDP per annum in infrastructure development and maintenance to close the infrastructure deficit, taking population growth, increasing urbanization and the impact of climate change into account. Such investment far exceeds current levels of infrastructure funding. Given the limited resource availability in countries with special needs, the report emphasizes that clear priorities are required for infrastructure development and that sequencing infrastructure investment is necessary by determining where the impact of additional infrastructure on sustainable development outcomes may be the largest.

Financing strategies for overcoming infrastructure gaps

Infrastructure financing requirements in the Asia-Pacific region, which are already large, will continue to increase in response to a rising demand for infrastructure stemming from the region’s rising wealth, its growing population, and rapid urbanization. Additional resources will also be needed to make the infrastructure more sustainable and climate-resilient, particularly in small island developing States and other low-lying coastal areas. Even at present, Governments in the region are unable to meet these financing requirements through traditional sources, such as tax revenue, official development assistance (ODA) and funding received by multilateral development banks (MDBs). Meeting future infrastructure financing needs therefore will require greater engagement of the private sector and other new donors, such as China and India, to ensure that sufficient resources can be raised for investment in infrastructure.